Hey Data – what’s the story? Data Based Marketing: when data tells stories

„Triple D” is the “XXL” of marketing.

In one of our last articles, we dealt with the topic of “creativity in marketing”. Today we want to turn the tables. We want to take a look at what is necessary for creations to develop their full originality. Actually, only three things are needed: data, data and (you guessed it) data.

Where does the power of persuasion come from?

Aristotle already knew that one must not base one’s argumentation on instincts alone. Logos, ethos, pathos – facts play an essential, if not the main, role at two of the three cornerstones of Aristotle’s theory of rhetoric. But first things first and above all: why Aristotle?

The second part of the question is easy to answer and yet will astonish some people. Because the doctrine of good speech, which the Athenian wrote down almost 2,500 years ago, is still used every day and in exactly the same way. It’s all about how to captivate your audience – to surprise them, appeal to them and convince them. The Aristotelian arithmetic of persuasion involves three things above all: the consistency (or proof) of a thesis (logos), the credibility of the speaker (ethos) and the emotional appeal (pathos). We don’t want to digress here, but without exaggeration, these three basic pillars of communication still form the basis for almost every kind of storytelling today, regardless of the form of delivery. Whether it’s a book, a film or a brochure, a campaign text or a website – without logos, ethos and pathos, it doesn’t work.

Aristotle and Data Based Marketing.

Honestly, isn’t that a bit far-fetched? Not at all, because to bring logos and ethos – two out of three elements – to life, we need deep knowledge about what is relevant to our audience. We need data. Aristotle and data-based marketing or data-driven marketing belong together like head and heart, like stomach and mind. As a small reminiscence of the chosen starting point, we are therefore dividing this article into three entertaining acts. We cast data in the leading and supporting roles and the story develops along a loose plot line around the topic of a fictitious campaign planning. Pay attention: especially in the second act, the old Athenian comes into his own. But as with any good play, a small excerpt is not enough. So with this in mind: “Raise the curtain on data-based marketing”.

Prologue: The market

Target group size, product life cycle, maturity, penetration and pricing pressure from competitors…. there is a lot of data that is examined when determining a target market. And not only when it comes to entering a new market. But also when a new product or bundle is to be positioned. Even companies that operate in familiar markets will resort to these figures. For example, when it comes to deriving the required number of prospects, sales opportunities and average amount per sale from the sales expectations.

It would not be the first time that marketing experts, when analysing the sales funnel, come to the conclusion that the number of companies in the market is not sufficient to achieve the set goals. If you need 1,000 customers for a profitable business result, you might need 5,000 concrete sales opportunities (5:1) to develop them from 50,000 responders (10:1) to a social media campaign. And if your market has no more than 10,000 potential customers? Then you have a problem. Can data-based marketing provide a remedy here? Perhaps. At the very least, it can show in what time frame the set goals can realistically be achieved. In addition (this is a small foretaste of the third act), you could improve the conversion rates from one sales funnel stage to the next on the basis of a holistic campaign reporting, up to the optimisation of the pitch by the sales team. So data-based marketing as a steering instrument not for marketing but also for sales? Yes, now we are talking.

Act 1: The target audience.

Appearance customer: In the prologue we thought about the number of companies we can address. Is that already all the data we need? Not at all. Now it really starts: Who do we want to talk to in the first place? What do we know about the socio-demographic characteristics of our counterparts? About gender, age, marital status, education level, income, living situation, etc.? Of course, not all of this data needs to be used for every action. What we need depends not only on our industry (FMCG works a little differently than automotive, for example), but also on our segment.

In B2C, perhaps the housing situation is more decisive than the career level. The latter, on the other hand, is a good data point in B2B because it helps us define a reference space for communication. HOW do we need to talk to our target group so that our offer gets the appropriate attention? Speaking of B2B communication. Beyond the above-mentioned data, we are interested here in which key figures our target group is responsible for, what is expected of them directly and indirectly. Again: we don’t collect data out of passion, but for a good reason: we want to understand our customer as a whole. Only then can we make him a targeted offer.

Act 2: The subject.

This is where Aristotle comes into play again: After collecting the basic data, the next step is to analyse the motivations of the target group as precisely as possible. Motivations, i.e. the proverbial “want to/must move something”, are always found when there is a challenge that cannot be solved with existing means. Motives give rise to a need for action. Now all we need is an impulse for action and we are in the game.

The task of marketing is to identify impulses for action. This makes it clear what we have to do: Identify demand, tailor the offer to it, and finally find a way to bring the first together with the second. We know the supply (or at least we should know it), so let’s turn our attention to demand. This yields a multitude of data points that are later used to tailor the campaign:

• What triggered the impulse to act?
• What is the challenge?
• Why can they not be solved with existing means?
• What are the consequences for our counterpart if the challenges remain unmet?
• And why is the impetus for action greatest right now?

Let’s run through the whole thing with an example and collect a few data points right away:
In 2018 (date!), the legislator created a legal basis in the form of the General Data Protection Regulation (date), which immediately put all business operators under pressure to act (date). This external impulse to act was followed by an internal analysis in many companies: Are we able to comply with the requirements? The vast majority of the answers were “No, we are not! (date). An enormous need for action arose, in this case even linked to a specific date (date). The demand for concepts and solutions for data protection skyrocketed. This example is also appropriate because it affects different target groups (date) within an organisation. The managing director (date) as the person with overall responsibility is exposed to a high economic risk (date), while the IT manager (date) must create the technical prerequisites for implementation (date) of the GDPR and the data protection officer (date) in turn must implement the regulatory requirements procedurally (date).

Have you been counting? On this Journey alone, we collected 11 data points. This is the moment when Aristotle appears on stage. Logos – the theorem of “compelling” evidence, is the moment we can put together a (compelling) proposition from these data points. What, why, for what and when. We have the data, we can launch. And what about ethos – credibility? For this point, we have also collected indirect data in our example, namely the business risk and the binding nature of the legal regulation. The factual framework underlines the pressure to act. Thus, we underline the urgency. Logos, ethos and data-based marketing: without data, no reason why, no urgency, no success.

Act 3: The realisation (and what we make of it).

Once we have dealt with the content in the second act, the next question is how to bring the whole thing to the street. It is obvious that data is the decisive factor here as well. We have already talked about target groups. At best, target groups can be classified into different clusters, perhaps even into communities. Communities, in turn, not only have their own narratives, they may also have particular sources that they trust. These trusted sources again yield a set of data points that we use to play out our messages. Which, as we have learned, are precisely tailored to the needs of the target group based on a detailed analysis of their needs and framework conditions.

But that’s not all. The reactions to the content we offer also provide us with further data points. We use these to continuously optimise the individual components of our marketing execution, optimise the playout in the selected communication channels and use them to sharpen our messages. We work continuously with and on the data for maximum success. However, this “grand finale” will only cause storms of applause if we have given our undivided attention to the main actors, the data, in the first and second acts.

Epilogue: Possible applications of data-based marketing

As the saying goes, “much said, much honoured”. But after all the storytelling, it is perhaps worth taking another look at the essential cornerstones of data-based marketing. When does it come into play and what is necessary to build up a data-based marketing organisation? Let’s keep in mind: targeted data collection, analysis and derivation of data-based insights are essential for defining the target group, identifying the challenges, tailoring the communication, defining the communication channels and finally for optimising the marketing impact. If companies cannot create the necessary conditions (knowledge databases, analytics clusters, messaging grids, communication preference matrices, etc.) or do not have the necessary skills in-house (expertise in performance marketing, data science and analytical tools), they should specifically call in external specialists.

German B2B SMEs in particular are only just taking the first steps towards digital marketing. Thinking about comprehensive data-based marketing, machine learning and AI-supported campaigns is still a long way off. The interest is often great (not as great as in the B2C sector, where there are hardly any marketing campaigns without extensive data analytics), but until the groundwork (e.g. a uniform data platform on which marketing, sales and customer service work together) is completed and the necessary experts are on board, these are only the first small steps in the world of data, which is already almost unlimited today.

Is data-based marketing a must, or is there not also marketing without data? To be honest, our experience shows that it would not be a drama to do without data-based marketing. It would be a tragedy.

Authors: Cloudbridge Marketing & Cornelia Kubinski

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